The sovereign credit ratings on Australia benefit from the country's strong institutional settings, its wealthy and resilient economy, monetary policy flexibility, and low government debt. The country's high external and household indebtedness, as well as vulnerability to weak commodity export demand, moderate these strengths. We are revising the rating outlook on Australia to negative from stable because we believe that without remedial action the government's fiscal stance may no longer be compatible with the country's high level of external indebtedness. We are also affirming the 'AAA' long-term and 'A-1+' short-term sovereign credit ratings on Australia and Efic. On July 7, 2016, S&P Global Ratings revised its rating outlook on the Commonwealth of Australia to negative from stable. At the same
